Martha Stewart Living Omnimedia (MSO) has three divisions: publishing, broadcasting and merchandising. In the five years up to the end of 2012, publishing revenue fell from $179.1 million to $122.5 million. Last year, the division lost $62 million. In the first quarter of this year, publishing revenue dropped from $30.8 million to $24.5 million. The unit lost $990,000 in that period. Because of its troubles, the company tried to sell off smaller magazines. Everyday Food stopped publication as a standalone title with the December 2012 issue. Whole Living was discontinued after the January/February 2013 issue.
The main problem at the company's flagship magazine, Martha Stewart Living, is the precipitous drop in advertising. According to the Media Industry Newsletter, the magazine's advertising pages fell from 1,306 in 2008 to 766 last year. Pages are up to 404 through the first half of this year, but even if the full year runs at this rate, it is not enough. The company does have a good opportunity to retrench.
Two of Omnimedia divisions are doing quite well and could sustain a restructured company. Merchandising had revenue of $11.5 million in the first quarter, and an operating income of $5.7 million. Even the small broadcasting operation made money. The company could move the magazine online to avoid the huge costs of paper, printing, and adding new subscribers. But Martha Stewart Living lost its ability to be a standalone print magazine long ago.